If the underwriter charges 5 of gross proceeds and all the


Highlander Homes stock trades at $32 per share and there are 50 million shares outstanding. The management would like to raise $200 million in an SEO. If the underwriter charges 5% of gross proceeds, and all the shares are primary shares sold to new investors, what percentage of the company will be owned by the new investors?

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Finance Basics: If the underwriter charges 5 of gross proceeds and all the
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